Shared Equity Programs
Fannie Mae supports affordable housing through programs such as down payment and closing cost assistance and the purchase or securitization of several types of shared equity mortgages.
Community land trust underwriting requirements updated
To better support affordable housing opportunities, we’ve simplified requirements for underwriting mortgages for properties located in community land trusts (CLTs). Read the December Selling Guide Update for details.
Shared Equity Programs
Shared equity programs preserve affordable homeownership opportunities by allowing borrowers to purchase homes at below-market prices. In exchange, borrowers agree to sell the property only to other income-qualified buyers and/or share the home’s appreciation with the organization that subsidized the purchase.
Community Land Trusts (CLTs)
In a CLT, a low- to moderate-income borrower can purchase a home on land leased through a municipality or nonprofit at affordable ground rent rates. The ground lease will typically require that the home can only be purchased by a low- to moderate-income family when resold.
Visit the Learning Center for additional resources, including fact sheets, checklists, and other resources.
Inclusionary housing initiatives are governmental programs that encourage creating affordable housing when communities are under development. These programs and policies can require or provide incentives for developers to create affordable housing units in developments. They can also include impact or linkage fees that generate revenue to help address the high cost of housing.1
These municipal or county housing policies typically require properties to be sold only to low- to moderate-income borrowers.
Limited Equity Cooperative
In a limited equity cooperative, residents own shares in a cooperative housing corporation that can be resold at prices that ensure continued affordability and allow for modest equity growth.
Homes in these communities may be eligible for Fannie Mae financing via the Project Eligibility Review Service (PERS). See Fannie Mae Selling Guide section B4-2.2-06, Project Eligibility Review Service (PERS), for eligibility requirements.
Identifying Shared Equity Programs
The Federal Housing Finance Agency (FHFA) provides general guidelines for identifying shared equity programs in its Enterprise Duty to Serve Rule.
Learn more about them here.
Other Shared Equity Programs
Are you working with a program that preserves affordable homeownership, but doesn't fall under one of the shared equity categories listed here? Contact your relationship manager to help us better understand the program.
Down Payment Assistance
Fannie Mae permits borrowers to obtain down payment and closing cost assistance from third party sources.
HFAs and Public Entities
In addition to housing counseling and other services, housing finance agencies (HFAs) can also provide down payment and closing cost assistance.
To find down payment assistance programs based on traits like location, household income, and more, visit DownPaymentResource.com.*
*DownPaymentResource.com is a third-party resource not affiliated with or endorsed by Fannie Mae.